KCC Roads Construction Private Limited

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In July 2011, Madhya Pradesh Road Development Corporation (MPRDC) awarded a 15-year concession to KCC Buildcon Private Limited for the strengthening, improvement,two-laning,operation and maintenance,and tolling of 76.09kms of existing major district roads - (32.20kms of) Sijhata-Hinoti-Malgaon-Khamariya-Ater section, the (25.09kms of) Poudi-Maharajpur-Parsamaniya section and the (18.80kms of) Mangawar-Bekunthpur section,in the state of Madhya Pradesh. Under the contract, KCC was responsible for the design, construction, finance, operation and maintenance,strengthening and widening the existing 2-lane carriageway to 2-lane divided carriageway.The scope included construction of new pavement, rehabilitation of existing pavement, construction and/or rehabilitation of major and minor bridges,culverts, road intersections,interchanges, drains, etc.The expansion project, part of the MDR (major district roads) development project, was expected to ease traffic congestion and give significant stimulus to trade and commerce in the entire region. KCC Buildcon Private Limited established KCC Roads Construction Private Limited (KCCR),a special purpose vehicle on 4th March 2013, to implement the project. The SPV won the tender through international competitive bidding, conducted by MPRDC,by requesting the lowest annuity payment. Other details of bidding were not known at the time of collection of this information. Under the contract, the SPV was to recover the capital costs and operating costs including returns through periodic payments from MPRDC, during the term of concession. KCC Buildcon would execute the EPC for the project. The timeline of signing concession agreement for this project couldn't be ascertained at the time of collection of this information. The project attained financial closure on 20th January 2014. The debt/equity ratio of the project was 76/24. The estimated capital cost of the project at the time of financial closure was US$ 16.4mn (INR 1000.7mn @61 INR/USD). Financing comprised of 12-year 9-months term loan of US$ 12.4mn (INR 760mn) and sponsor equity of US$ 3.9mn (INR 240.7mn). The term loan had a grace period of 9 months and repayment schedule of 22 semi-annual installments. The loan was priced at 24.05%. The loan was arranged by Allahabad Bank. The project construction was scheduled to start on 19th September 2013 and operation was expected to start on 23rd March 2015.